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NORTHRIM BANK
EXECUTIVE INCENTIVE PLAN
Originally Effective as of
November 3, 1994
Amended Effective as of
May 14, 2009
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NORTHRIM BANK ANNUAL
EXECUTIVE INCENTIVE PLAN
The plan will
be administered by the Compensation Committee
(“Committee”) of the Board of Directors of Northrim
Bank (“Bank”).
Participation
in the plan is limited to members of management whose performance
has a significant impact on the success of the Bank.
Participants in
the Executive Incentive Plan (“Plan”) must be
recommended by the Chairman of the Board or President and approved
by the Committee prior to each plan year.
The minimum
factors to be used in evaluating and recommending individuals for
Plan participation are as follows:
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Head of a department or equivalent
responsibilities.
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Significant impact on the bottom
line of the Bank.
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Management
responsibility.
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Record of superior performance and
initiative to surpass expectation.
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This is an earned benefit and will
not necessarily be made to newly hired or promoted managers who
might otherwise be qualified for plan inclusion.
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The following
conditions must be met prior to the payment of any criteria based
award:
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In
the sole opinion of the Committee, the Company’s operations
support the payment of bonus compensation to its senior
officers.
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Consolidated net income should
exceed a minimum 1.0% Return on Average Assets (ROA) in order
for any Performance Criteria Award to be paid to an Executive
Officer.
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Each Plan
participant will be assigned an incentive award amount established
as a percent of their base salary. Base salary is the annual salary
in effect at the close of the plan year, prior to any deductions,
such as for 401(K), salary deferral, etc. Award amounts will be
based on the participants’ officer title and their
corresponding level of responsibilities.
There will be
three tiers of incentive award amounts as follows:
Participants:
President and Chairman.
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Minimum
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Target
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Maximum
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40%
Award
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50%
Award
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Participants:
Executive Officers
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Minimum
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Target
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Maximum
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30%
Award
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40%
Award
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Participants:
Senior Vice Presidents and Other Participants
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Minimum
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Target
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Maximum
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25%
Award
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35%
Award
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The listed
award amounts are earned by the Plan participants at the completion
of the plan year, if the performance standards achieved for the
criteria are met by the Bank. If the Bank fails to meet the minimum
criteria standards listed, then no award amounts would be made for
those criteria for the plan year. Individual performance measures
may be instituted in certain cases and would be in addition
to
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